Last checked at 27 Jun 2011 07:00
27 June 2011 Totally PLC ("Totally" or "the Company") Final results for the year ended 31 December 2010
Performance highlights
* Revenues from continuing operations £1.88m +7 per cent. yr/yr (2009: £ 1.76m). * Gross Profit from continuing operations £0.145m + 5 per cent yr/yr (2009: £ 0.138m) * Operating Profit from continuing operations before tax £0.10m (2009: £ 0.14m) * Total EBITDA from continuing operations £0.15m (2009: £0.17m). * Total operating profit from continuing operations before tax and head office charges £0.39m (2009: £0.43m). * Total EBITDA from continuing operations before head office charges was £ 0.43m (2009: £0.46m). * Cash generated from operating activities £0.08m (2009: £0.16m). * Basic earnings per share 0.1p (2009: 0.2p per share)
Chairman's Statement
Despite the ongoing recessionary pressures I am pleased to be able to report a second consecutive year of profit in 2010 and an increase in revenues of 7 per cent and in Gross Profit of 5 per cent.
The Group generated revenues from continuing operations of £1.88m (2009: £ 1.76m), EBITDA of £0.15m (2009: £0.17m) and an operating profit before tax from continuing operations of £0.11m (2009: £0.14m).
I believe this is a positive achievement in a challenging marketplace and is testimony to the skills of our staff and to the leadership of our business.
Board, Staff and Clients
I would like to thank Totally's board and staff for their efforts over the period under review as well as our clients.
Prospects
Trading since the beginning of the current financial year has, despite the continuing weak market conditions, been stable and the Board looks forward to a positive outcome for the full year.
Dr. Michael SinclairNon-Executive ChairmanFurther enquiries:Totally Plc www.totallyplc.com Daniel Assor, CEO 020 7692 6929 Merchant Securities Limited Simon Clements 020 7628 2200 Virginia Bull Business review
The Business Review should be read in conjunction with the Chairman's Statement on page 4 which includes information about the Group's business performance during the year and an indication of the Group's future prospects. A review of the Group's financial position is included in the Directors' report.
Digital Marketing: "Totally Communications "
2010 saw strong top lines sales growth of 15.2 per cent. despite an uncertain market with recessionary pressures.
During the period under review, the division's three core units of website and bespoke software development; hosting maintenance & support and online marketing, delivered continued and sustainable revenue growth. 65 organisations are now secured on long-term hosting, maintenance and support contracts, which make up over 20 per cent. of revenues.
Rise Digital, a dedicated Online Marketing division, was launched. Rise specialises in the delivery of Search Engine Optimisation, Pay per Click and Social Media campaigns. Rise Digital revenues represented c.10 per cent. of annual revenues and long-term contracts for SME's and corporate organisations were secured.
Particularly strong growth was achieved developing websites and bespoke web-enabled software for clients in both the private and Not for Profit sectors. One contributing factor was the completion of an enterprise website management system, Pelorous, which enables development and subsequent implementation of large scale web-based propositions expediently without compromising quality or robustness. Pelorous is a result of a number of years of development and reduces the requirement for client testing of new websites and online propositions by approximately 30 per cent.
During this reporting period, Totally Communications has continued to work with a number of its long-term clients, delivering consultancy and web-enabled solutions, however as recessionary pressures in the market place have continued, a number of additional organisations have secured Totally Communications expertise and experience to deliver efficiencies by leveraging the power of the Internet.
During the reporting period, Totally Communications commercial and corporate clients included Barclays Capital, Solar Century (leading solar energy company), and The Clear Company (specialist recruiter for companies such as E.O.N and B.T.), BSB Law & Volcanoes Safaris. However Totally Communications made significant progress in its position as a specialist in the third sector. Highlights for the reporting period include:
Health Foundation (a not for profit organisation dedicated to clinical excellence in the UK); Totally Communications constructed a large website proposition containing an online network and online resources. This was a multi agency pitch.
Employers Forum on Disability; Totally Communications secured a large project to bring online an updated version of the clients scorecard system which is a self-help tool to allow organisations to monitor their compliance with their legal requirements covering disability.
WJR; the leading UK Jewish international agency responding to the needs of Jewish communities at risk or in crisis, outside the UK; Totally Communications was retained for a third time to upgrade their substantial website proposition which includes an ethical giving micro-site.
Philanthropy Bridge Foundation; an organisation which works to connect giving from emerging economy countries with charities around the world; Totally Communications was secured to construct a modest initial website for this new organisation working with high-profile individuals to target giving in the third world.
The Holocaust Explained; an educational portal dedicated to Key Stage 3 of the national curriculum, sponsored by Deutsche Bank and the London Grid, resulting in a high profile launch at the Foreign Office by Secretary of State for Education, Michael Gove.
Totally Communications' ongoing support for the third sector saw significant work on its proprietary product, "Totally Giving", a new donor acquisition tool for charities. The initial prototype was launched prior to this reporting period for a charity which resulted in "54 per cent. of all donations via the portal being from new donors". During the period under review the system was sold to a second charity and developed into a generic fundraising support tool to be rolled out as Totally Communications' first stand -alone product. The product has significant potential in the third sector market, as it focuses on the acquisition of data which subsequently drives new donor acquisition which continues to be a significant growth area for charities that are all facing fundraising pressures.
Post Reporting Period Events
Q1 & Q2 2011 have seen a continuation of the strategy for aggressive organic growth, and have shown a significant increase of 25 per cent. (unaudited) in revenues in this division compared to the same period in 2010, whilst cash collection has shown an increase of nearly 50 per cent. (unaudited) in this division.
As a result, Totally Communications has moved into a substantially larger office, and is currently recruiting a number of additional employees.
During the first few months of 2011, following a multi-agency pitch, Totally Communications, was delighted to be awarded a contract with the charity Crisis to construct an extensive web-enabled volunteer management system. Totally Communications reach into the third sector continued with contract wins with Parenting UK and Kusuma Trust along with ongoing work with The Health Foundation. Other notable project wins since the start of 2011 included for Linked In, Le Cordon Bleu and Katie Price. Notable contract wins for Rise Digital included Ingersoll Rand (international commercial manufacturer), Homesun (solar power), Art You Grew Up With, Celebrity Group and Paulie Clothing.
Andy Margolis
Managing Director Totally Communications Limited
Niche Community Publishing
The Jewish News & Media Group is the umbrella brand for the group's publishing businesses which include two trading subsidiaries, the Jewish News Limited and TotallyJewish.com Limited.
The group publishes on and offline media for the UKs Jewish community including:
• A weekly newspaper, `Jewish News'
• A quarterly lifestyle magazine, `Pulse'
• An annual Celebrations magazine, `TotallyJewishSimchas'
• A community portal, `www.TotallyJewish.com'
• An annual Wedding exhibition, www'TotallyJewishSimchas Live!'
www.thejngroup.com
Performance Highlights
• Revenues of £1,146,000, (2009: £1,130,000)
• EBITDA of £204,000 (2009: £252,000)
• Operating Profit of £177,000 (2009: £228,000)
Post Reporting Period Events
In May 2011 the business announced plans to hold a significant new community exhibition at Wembley Stadium on 18 March 2012. Jewish Living Expo is a consumer event where visitors will be invited to browse, eat, shop and engage with 175+ quality brands from across an array of industries including food, travel, education, fashion, community, lifestyle and the home. In addition live performances and educational workshops will be held throughout the day. Revenues will be derived from entrance tickets, stand sales and sponsorship.
www.jewishlivingexpo.com
Dan Assor
CEO & Managing Director Jewish News & Media Group
Consolidated Income Statement for the year ended 31 December 2010
Note 2010 2009 £000 £000 Continuing operations Revenue 1,882 1,758 Cost of Sales (427) (381) Gross profit 1,455 1,377 Administrative expenses (1,308) (1,204) Profit before interest, tax, depreciation and 147 173amortisation Depreciation (1) (5) Amortisation (40) (24) Operating profit 106 144 Finance costs (20) (19) Profit before taxation 86 125 Income tax 3 10 16 Profit for the year attributable to the equity 96 141shareholders of the parent company All comprehensive income for the current and prior year is included in the income statement above. Earnings per share 2010 2009 Pence Pence Basic Continuing operations 0.1p 0.2p Diluted Continuing operations 0.1p 0.2p
Consolidated statement of changes in equity for the year ended 31 December 2010
Share Share Translation Profit and Equity Reserve capital premium loss shareholders' account account deficit £000 £000 £000 £000 £000 At 1 January 2009 1,124 3,353 - (5,062) (585) Profit for the year - - - 141 141 Credit on issue of - - 5 5share options Credit on issue of - - - 7 7warrants At 1 January 2010 1,124 3,353 - (4,909) (432) Profit for the year - - - 96 96 Credit on issue of - - - 2 2share options Credit on issue of - - - 13 13warrants At 31 December 2010 1,124 3,353 - (4,798) (321)
Consolidated statement of financial position as at 31 December 2010
Note 2010 2009 £000 £000 £000 £000 Non current assets Intangible fixed assets 38 60 Property, plant and equipment 4 4 42 64 Current assets Trade and other receivables 4 374 266 Cash and cash equivalents - - 374 266 Current liabilities Trade and other payables (335) (321) Financial liabilities (402) (441) (737) (762) Net current liabilities (363) (496) Net liabilities (321) (432) Shareholders' equity Called up share capital 1,124 1,124 Share premium account 3,353 3,353 Retained earnings (4,798) (4,909) Equity shareholders' deficit (321) (432)
Consolidated cash flow statement for the year ended 31 December 2010
Note 2010 2009 £000 £000 Operating activities Operating profit 106 144 Option and warrants charge 15 12 Amortisation and depreciation 41 29 (Increase)/decrease in trade and other receivables (108) 24 Increase/(decrease) in trade and other payables 14 (65) Cash flow from operations 68 144 Taxation R&D tax credit 3 10 16 Net cash flows from operating activities 78 160 Investing activities Purchase of property, plant and equipment (19) (35) Net cash flows from investing activities (19) (35) Cash inflow before financing 59 125 Financing activities Interest paid (20) (19) Net increase in cash and cash equivalents 39 106 Cash and cash equivalents at beginning of year (441) (547) Cash and cash equivalents at end of year (402) (441) Cash and cash equivalents comprise:- Bank overdrafts (402) (441) (402) (441)
Notes to the financial statements for the year ended 31 December 2010
1. General information
Totally Plc is a public limited company ("Company") incorporated in the United Kingdom under the Companies Act 2006 (registration number 3870101). The Company is domiciled in the United Kingdom and its registered address is Unit 611 Highgate Studios, 53-79 Highgate Road, London NW5 1TL. The Company's Ordinary Shares are traded on the AlM Market of the London Stock Exchange ("AIM")
The Group's principal activities have been niche community media and the provision of software development and digital marketing services. The Company's principal activity is to act as a holding company for its subsidiaries.
2. Basis of preparation
The financial year represents the 365 days to 31 December 2010, and the prior financial year, 365 days to 31 December 2009. The financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (£000) except when otherwise indicated.
The accounting policies set out in note 4 have been applied consistently to all periods presented in these consolidated financial statements.
The financial statements are prepared on a going concern basis which the Directors believe to be appropriate for the following reasons. The Group currently meets its day to day working capital requirements through two overdraft facilities which are repayable on demand.
The Group has confirmed the availability of a facility of £700,000 with Bank Hapoalim which was renewed on until 30 June 2010. As security for the facility, the bank has obtained the unlimited Joint and Several Guarantees of Dr Michael Sinclair (non-executive Chairman), and Mr Leo Noe. Dr Sinclair and Mr Noe have confirmed to the Company that they will keep this guarantee in place until 31 May 2012.
In addition, a working capital facility of £50,000 has been agreed with NatWest which is secured on the Group's debtor book. This facility is due for renewal on 30 September 2011.
The Directors have prepared projected cash flow information for the period ending 12 months from the date of their approval of these financial statements.
On the basis of cash flow forecasts and discussions with the Group's bankers and guarantee holders, the Directors consider that the Group will be able to operate within the facilities currently agreed.
Inherently, there can be no certainty in relation to these matters, but theDirectors believe that the going concern basis of preparation continues to beappropriate. 3. Taxation a. Taxation charge b. 2010 2009 £000 £000 Research and development tax credit (10) (16)
Total current income tax credit charged in the income (10) (16) statement
b. Taxation reconciliation
The current income tax credit for the period is explained below:
2010 2009 £000 £000 Profit before tax 86 125
Taxation at the standard UK income tax rate of 28 per cent 24 35 (2009: 28 per cent)
Research and Development tax credit (10) (16) Utilisation of brought forward tax losses (24) (35) Total income tax credited in the income statement (10) (16)
c. Deferred tax
Estimated tax losses of approximately £3,600,000 (2009: £3,699,000) are available to relieve future profits of the Group. A deferred tax asset has not been recognised in respect of these losses due to uncertainty as to the timing and tax rate at which these losses will be utilised against future taxable profit streams.
4. Trade and other receivables
2010 2009 £000 £000 Trade receivables 283 200 Less: provision for impairment on receivables (8) (1) Trade receivables -net 275 199 Amount due from group undertakings - - Other debtors 10 10 Prepayments and accrued income 89 57 374 266
5. Related party transactions
The Group has taken advantage of the exemption available under IAS 24, "Related Party Disclosures", not to disclose details of transactions between Group undertakings which are eliminated on consolidation.
Included within current liabilities on the Company statement of financial position are amounts owed to 100% subsidiary undertakings of £1.26m (2009: £ 0.55m). The movement in the Company's balances with its subsidiaries reflects the group's banking facilities and arrangements operating during the year.
The following related party transactions have been carried out at arm's length and are required to be disclosed in accordance with IAS24.
As set out in note 3, Dr Michael Sinclair and Mr Leo Noe have provided guarantees in respect of the Group's current overdraft facility.
The company charged East Kings Ltd £12,500 (2009: £nil) for technical services provided. Dr M J Sinclair is a director of East Kings Ltd.
In 2010, purchases of £nil (2009: £2,000), on an arm's length basis were made from J Margolis, mother of A Margolis who is a director of both Totally Communications Limited and Totallyjewish.com Limited. A balance of £nil (2009: £nil) is included in trade creditors at the year end.
During 2010, 32,424,153 warrants (2009: 9,080,633) and nil options (2009: 5,450,000) have been granted to D Assor. The exercise price is 1 pence per option and 1 pence per warrant.
During 2010, 17,500,000 warrants (2009: 7,671,905) and nil options (2009: 5,125,000) have been granted to A Margolis. The exercise price is 1 pence per option and 1 pence per warrant.
During 2010, 7,500,000 warrants (2009: Nil) have been granted to B Gritz, who is a director of Totally Communications Limited. The exercise price is 1 pence per warrant.
6. Dividend
The Directors do not propose the payment of a dividend.
7. Copies of Report and Accounts
Copies of the Report and Accounts have been posted to shareholders, are available from the Company's registered office Unit 611 Highgate Studios, 53-79 Highgate Road, London NW5 1TL and are available from the Company's website www.totallyplc.com.
XLON